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Published: 2023-04-19 00:00:00 ET

EX-99.3 4 q123financialsupplement.htm EX-99.3 Document

Financial Supplement

First Quarter 2023


Table of Contents						Page

Consolidated Financial Highlights						3

Consolidated Statements of Operations (unaudited)						5

Consolidated Balance Sheets (unaudited)						6

Loans and Deposits						7

Average Balance Sheets, Annualized Yields and Rates						8

Mortgage Banking Fees						9

Segment Financial Highlights						10

Credit-Related Information:
Nonaccrual loans and leases						13
Loans and Leases 90 Days or More Past Due and Accruing						14
Charge-offs, Recoveries, and Related Ratios						15
Summary of Changes in the Components of the Allowance for Credit Losses						17

Capital and Ratios						18

Non-GAAP Financial Measures and Reconciliations						19
The information in this Financial Supplement is preliminary and based on company data available at the time of the earnings presentation. It speaks only as of the particular date or dates included in the accompanying pages. The Company does not undertake an obligation to, and disclaims any duty to, update any of the information provided. Any forward-looking statements in this Financial Supplement are subject to the forward-looking statements language contained in the Company’s reports filed with the SEC pursuant to the Securities Exchange Act of 1934, which can be found on the SEC’s website (www.sec.gov) or on the Company’s website (www.citizensbank.com). The Company’s future financial performance is subject to the risks and uncertainties described in its SEC filings.

CONSOLIDATED FINANCIAL HIGHLIGHTS

(in millions, except share, per-share and ratio data)


	QUARTERLY TRENDS
											1Q23 Change
	1Q23		4Q22		3Q22		2Q22		1Q22		4Q22				1Q22
											$/bps		%		$/bps		%
SELECTED OPERATING DATA
Total revenue	$2,128		$2,200		$2,177		$1,999		$1,645		($72)		(3	%)	$483		29	%
Noninterest expense	1,296		1,240		1,241		1,305		1,106		56		5		190		17
Profit before provision (benefit) for credit losses	832		960		936		694		539		(128)		(13)		293		54
Provision (benefit) for credit losses	168		132		123		216		3		36		27		165		NM
NET INCOME	511		653		636		364		420		(142)		(22)		91		22
Net income, Underlying1	560		685		669		595		476		(125)		(18)		84		18
Net income available to common stockholders	488		621		611		332		396		(133)		(21)		92		23
Net income available to common stockholders, Underlying1	537		653		644		563		452		(116)		(18)		85		19
PER COMMON SHARE DATA
Basic earnings	$1.00		$1.26		$1.23		$0.68		$0.94		($0.26)		(21	%)	$0.06		6	%
Diluted earnings	1.00		1.25		1.23		0.67		0.93		(0.25)		(20)		0.07		8
Basic earnings, Underlying1	1.10		1.32		1.30		1.14		1.07		(0.22)		(17)		0.03		3
Diluted earnings, Underlying1	1.10		1.32		1.30		1.14		1.07		(0.22)		(17)		0.03		3
Cash dividends declared and paid per common share	0.42		0.42		0.42		0.39		0.39		—		—		0.03		8
Book value per common share	45.84		44.03		42.62		45.02		47.42		1.81		4		(1.58)		(3)
Tangible book value per common share	29.44		27.88		26.62		29.14		30.97		1.56		6		(1.53)		(5)
Dividend payout ratio	42	%	33	%	34	%	57	%	41	%	900	bps			100	bps
Dividend payout ratio, Underlying1	38		32		32		34		36		600	bps			200	bps
COMMON SHARES OUTSTANDING
Average: Basic	485,444,313		493,293,981		495,651,083		491,497,026		422,401,747		(7,849,668)		(2	%)	63,042,566		15	%
Diluted	487,712,146		495,478,398		497,477,501		493,296,114		424,670,871		(7,766,252)		(2)		63,041,275		15
Common shares at period-end	483,982,264		492,282,158		495,843,793		495,650,259		423,031,985		(8,299,894)		(2)		60,950,279		14

1 These are non-GAAP financial measures. For further information on these measures, refer to "Non-GAAP Financial Measures and Reconciliations."

CONSOLIDATED FINANCIAL HIGHLIGHTS, CONTINUED

(in millions, except ratio and headcount data)


	QUARTERLY TRENDS
											1Q23 Change
	1Q23		4Q22		3Q22		2Q22		1Q22		4Q22			1Q22
											$/bps		%	$/bps		%
FINANCIAL RATIOS
Net interest margin	3.29	%	3.29	%	3.24	%	3.04	%	2.75	%	—	bps		54	bps
Net interest margin, FTE1	3.30		3.30		3.25		3.04		2.75		—			55
Return on average common equity	9.11		11.56		10.91		5.95		7.65		(245)			146
Return on average common equity, Underlying2	10.01		12.15		11.52		10.06		8.75		(214)			126
Return on average tangible common equity	14.38		18.46		16.96		9.13		11.36		(408)			302
Return on average tangible common equity, Underlying2	15.80		19.40		17.91		15.45		12.99		(360)			281
Return on average total assets	0.93		1.15		1.12		0.66		0.90		(22)			3
Return on average total assets, Underlying2	1.02		1.21		1.18		1.08		1.03		(19)			(1)
Return on average total tangible assets	0.97		1.19		1.16		0.69		0.94		(22)			3
Return on average total tangible assets, Underlying2	1.06		1.25		1.22		1.12		1.06		(19)			—
Effective income tax rate	22.97		21.16		21.80		23.77		21.70		181			127
Effective income tax rate, Underlying2	23.25		21.37		22.00		23.69		21.70		188			155
Efficiency ratio	60.90		56.36		57.02		65.27		67.23		454			(633)
Efficiency ratio, Underlying2	57.84		54.42		54.90		58.16		64.28		342			(644)
Noninterest income as a % of total revenue	22.81		22.92		23.54		24.72		30.26		(11)			(745)
Noninterest income as a % of total revenue, Underlying2	22.81		22.92		23.54		25.88		30.26		(11)			(745)
CAPITAL RATIOS - PERIOD-END (PRELIMINARY)
CET1 capital ratio	10.0	%	10.0	%	9.8	%	9.6	%	9.7	%
Tier 1 capital ratio	11.1		11.1		10.9		10.6		10.9
Total capital ratio	12.9		12.8		12.6		12.3		12.5
Tier 1 leverage ratio	9.4		9.3		9.2		9.3		9.6
Tangible common equity ratio	6.6		6.3		6.1		6.6		7.1
SELECTED BALANCE SHEET DATA
Loan-to-deposit ratio (period-end balances)	89.83	%	86.69	%	87.44	%	87.28	%	82.70	%	314	bps		713	bps
Loan-to-deposit ratio (average balances)	89.76		87.74		88.32		87.24		83.28		202	bps		648	bps
Full-time equivalent colleagues (period-end)	18,547		18,889		19,235		19,583		17,843		(342)		(2)	704		4

1Net interest margin is presented on a fully taxable-equivalent ("FTE") basis using the federal statutory tax rate of 21%. The FTE impact is predominantly attributable to commercial loans for the periods presented.

2These are non-GAAP financial measures. For further information on these measures, refer to "Non-GAAP Financial Measures and Reconciliations."

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(in millions)


	QUARTERLY TRENDS
						1Q23 Change
	1Q23	4Q22	3Q22	2Q22	1Q22	4Q22			1Q22
						$	%		$	%
INTEREST INCOME
Interest and fees on loans and leases	$2,047	$1,893	$1,657	$1,370	$1,048	$154	8	%	$999	95	%
Interest and fees on loans held for sale	15	16	18	17	16	(1)	(6)		(1)	(6)
Interest and fees on other loans held for sale	5	10	15	25	7	(5)	(50)		(2)	(29)
Investment securities	266	258	243	201	138	8	3		128	93
Interest-bearing deposits in banks	69	75	36	13	4	(6)	(8)		65	NM
Total interest income	2,402	2,252	1,969	1,626	1,213	150	7		1,189	98
INTEREST EXPENSE
Deposits	550	396	176	54	25	154	39		525	NM
Short-term borrowed funds	6	2	11	10	—	4	200		6	100
Long-term borrowed funds	203	159	117	57	41	44	28		162	NM
Total interest expense	759	557	304	121	66	202	36		693	NM
Net interest income	1,643	1,695	1,665	1,505	1,147	(52)	(3)		496	43
NONINTEREST INCOME
Service charges and fees	100	105	109	108	98	(5)	(5)		2	2
Capital markets fees	83	98	89	88	93	(15)	(15)		(10)	(11)
Card fees	72	71	71	71	60	1	1		12	20
Mortgage banking fees	57	54	66	72	69	3	6		(12)	(17)
Trust and investment services fees	63	61	61	66	61	2	3		2	3
Foreign exchange and derivative products	48	35	42	60	51	13	37		(3)	(6)
Letter of credit and loan fees	40	41	40	40	38	(1)	(2)		2	5
Securities gains, net	5	4	—	1	4	1	25		1	25
Other income	17	36	34	(12)	24	(19)	(53)		(7)	(29)
Total noninterest income	485	505	512	494	498	(20)	(4)		(13)	(3)
TOTAL REVENUE	2,128	2,200	2,177	1,999	1,645	(72)	(3)		483	29
Provision (benefit) for credit losses	168	132	123	216	3	36	27		165	NM
NONINTEREST EXPENSE
Salaries and employee benefits	658	633	639	683	594	25	4		64	11
Outside services	176	170	172	189	169	6	4		7	4
Equipment and software	169	170	159	169	150	(1)	(1)		19	13
Occupancy	124	110	106	111	83	14	13		41	49
Other operating expense	169	157	165	153	110	12	8		59	54
Total noninterest expense	1,296	1,240	1,241	1,305	1,106	56	5		190	17
Income before income tax expense	664	828	813	478	536	(164)	(20)		128	24
Income tax expense	153	175	177	114	116	(22)	(13)		37	32
Net income	$511	$653	$636	$364	$420	($142)	(22	%)	$91	22	%
Net income, Underlying1	$560	$685	$669	$595	$476	($125)	(18	%)	$84	18	%
Net income available to common stockholders	$488	$621	$611	$332	$396	($133)	(21	%)	$92	23	%
Net income available to common stockholders, Underlying1	$537	$653	$644	$563	$452	($116)	(18	%)	$85	19	%

1 These are non-GAAP financial measures. For further information on these measures, refer to "Non-GAAP Financial Measures and Reconciliations."

CONSOLIDATED BALANCE SHEETS (unaudited)

(in millions)


PERIOD-END BALANCES	AS OF					MARCH 31, 2023 CHANGE
	Mar 31, 2023	Dec 31, 2022	Sept 30, 2022	June 30, 2022	Mar 31, 2022	December 31, 2022			March 31, 2022
						$	%		$	%
ASSETS
Cash and due from banks	$1,283	$1,489	$1,235	$1,456	$1,223	($206)	(14	%)	$60	5	%
Interest-bearing cash and due from banks	6,691	9,058	6,925	5,058	8,713	(2,367)	(26)		(2,022)	(23)
Interest-bearing deposits in banks	320	303	261	469	685	17	6		(365)	(53)
Debt securities available for sale, at fair value	23,845	24,007	23,478	24,961	25,319	(162)	(1)		(1,474)	(6)
Debt securities held to maturity	9,677	9,834	10,071	9,567	2,056	(157)	(2)		7,621	NM
Loans held for sale, at fair value	855	774	1,048	1,377	1,717	81	10		(862)	(50)
Other loans held for sale	1,000	208	914	2,078	99	792	NM		901	NM
Loans and leases	154,688	156,662	156,140	156,172	131,305	(1,974)	(1)		23,383	18
Less: Allowance for loan and lease losses	(2,017)	(1,983)	(1,980)	(1,964)	(1,720)	(34)	2		(297)	17
Net loans and leases	152,671	154,679	154,160	154,208	129,585	(2,008)	(1)		23,086	18
Derivative assets	569	842	1,352	1,669	1,675	(273)	(32)		(1,106)	(66)
Premises and equipment	866	844	827	885	793	22	3		73	9
Bank-owned life insurance	3,244	3,236	3,222	3,207	2,960	8	—		284	10
Goodwill	8,177	8,173	8,160	8,081	7,232	4	—		945	13
Other intangible assets	185	197	199	211	115	(12)	(6)		70	61
Other assets	12,873	13,089	12,832	13,485	9,925	(216)	(2)		2,948	30
TOTAL ASSETS	$222,256	$226,733	$224,684	$226,712	$192,097	($4,477)	(2	%)	$30,159	16	%
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Noninterest-bearing	$44,326	$49,283	$51,888	$54,169	$50,113	($4,957)	(10	%)	($5,787)	(12	%)
Interest-bearing	127,868	131,441	126,678	124,756	108,663	(3,573)	(3)		19,205	18
Total deposits	172,194	180,724	178,566	178,925	158,776	(8,530)	(5)		13,418	8
Short-term borrowed funds	1,018	3	263	3,763	25	1,015	NM		993	NM
Derivative liabilities	1,704	1,909	2,227	1,004	635	(205)	(11)		1,069	168
Long-term borrowed funds:
FHLB advances	11,779	8,519	9,519	8,269	20	3,260	38		11,759	NM
Senior debt	5,263	5,555	4,954	4,176	4,290	(292)	(5)		973	23
Subordinated debt and other debt	1,813	1,813	1,813	1,995	1,584	—	—		229	14
Total long-term borrowed funds	18,855	15,887	16,286	14,440	5,894	2,968	19		12,961	220
Other liabilities	4,284	4,520	4,196	4,252	4,693	(236)	(5)		(409)	(9)
TOTAL LIABILITIES	198,055	203,043	201,538	202,384	170,023	(4,988)	(2)		28,032	16
STOCKHOLDERS' EQUITY
Preferred stock:
$25.00 par value, 100,000,000 shares authorized for each of the periods presented	2,014	2,014	2,014	2,014	2,014	—	—		—	—
Common stock:
$0.01 par value, 1,000,000,000 shares authorized for each of the periods presented	6	6	6	6	6	—	—		—	—
Additional paid-in capital	22,183	22,142	22,121	22,100	19,021	41	—		3,162	17
Retained earnings	9,416	9,159	8,748	8,346	8,209	257	3		1,207	15
Treasury stock, at cost	(5,475)	(5,071)	(4,920)	(4,920)	(4,918)	(404)	(8)		(557)	(11)
Accumulated other comprehensive income (loss)	(3,943)	(4,560)	(4,823)	(3,218)	(2,258)	617	14		(1,685)	(75)
TOTAL STOCKHOLDERS' EQUITY	24,201	23,690	23,146	24,328	22,074	511	2		2,127	10
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$222,256	$226,733	$224,684	$226,712	$192,097	($4,477)	(2	%)	$30,159	16	%
Memo: Total tangible common equity	$14,247	$13,728	$13,197	$14,444	$13,100	$519	4	%	$1,147	9	%

LOANS AND DEPOSITS

(in millions)


PERIOD-END BALANCES	AS OF					MARCH 31, 2023 CHANGE
	Mar 31, 2023	Dec 31, 2022	Sept 30, 2022	June 30, 2022	Mar 31, 2022	Dec 31, 2022			March 31, 2022
						$	%		$	%
LOANS AND LEASES
Commercial and industrial	$50,450	$51,836	$50,989	$51,801	$45,724	($1,386)	(3	%)	$4,726	10	%
Commercial real estate	28,999	28,865	28,681	28,070	14,268	134	—		14,731	103
Leases	1,417	1,479	1,444	1,574	1,529	(62)	(4)		(112)	(7)
Total commercial	80,866	82,180	81,114	81,445	61,521	(1,314)	(2)		19,345	31
Residential mortgages	30,362	29,921	29,548	29,088	24,211	441	1		6,151	25
Home equity	14,135	14,043	13,684	13,122	12,264	92	1		1,871	15
Automobile	11,535	12,292	13,155	13,868	14,439	(757)	(6)		(2,904)	(20)
Education	12,634	12,808	13,094	13,141	13,306	(174)	(1)		(672)	(5)
Other retail	5,156	5,418	5,545	5,508	5,564	(262)	(5)		(408)	(7)
Total retail	73,822	74,482	75,026	74,727	69,784	(660)	(1)		4,038	6
Total loans and leases	$154,688	$156,662	$156,140	$156,172	$131,305	($1,974)	(1	%)	$23,383	18	%
Loans held for sale, at fair value	855	774	1,048	1,377	1,717	81	10		(862)	(50)
Other loans held for sale	1,000	208	914	2,078	99	792	NM		901	NM
Loans and leases and loans held for sale	$156,543	$157,644	$158,102	$159,627	$133,121	($1,101)	(1	%)	$23,422	18	%

DEPOSITS
Demand	$44,326	$49,283	$51,888	$54,169	$50,113	($4,957)	(10	%)	($5,787)	(12	%)
Money market	48,905	49,905	49,081	48,063	45,342	(1,000)	(2)		3,563	8
Checking with interest	34,496	39,721	38,040	39,611	32,417	(5,225)	(13)		2,079	6
Savings	29,789	29,805	29,882	27,959	26,104	(16)	—		3,685	14
Term	14,678	12,010	9,675	9,123	4,800	2,668	22		9,878	206
Total deposits	$172,194	$180,724	$178,566	$178,925	$158,776	($8,530)	(5	%)	$13,418	8	%


AVERAGE BALANCE SHEETS, ANNUALIZED YIELDS AND RATES
(in millions, except rates)

	QUARTERLY TRENDS												1Q23 Change
	1Q23				4Q22				1Q22				4Q22			1Q22
	Average Balances	Interest	Rate		Average Balances	Interest	Rate		Average Balances	Interest	Rate		Average Balances	Interest	Rate	Average Balances	Interest	Rate
INTEREST-EARNING ASSETS
Interest-bearing cash and due from banks and deposits in banks	$5,899	$69	4.65	%	$6,915	$75	4.22	%	$8,055	$4	0.21	%	($1,016)	($6)	43 bps	($2,156)	$65	444 bps
Taxable investment securities	38,953	266	2.74		38,770	258	2.66		29,245	138	1.88		183	8	8	9,708	128	86
Non-taxable investment securities	2	—	2.68		2	—	2.39		2	—	2.60		—	—	29	—	—	8
Total investment securities	38,955	266	2.74		38,772	258	2.66		29,247	138	1.88		183	8	8	9,708	128	86

Commercial and industrial	51,993	735	5.66		52,311	652	4.89		44,947	328	2.91		(318)	83	77	7,046	407	275
Commercial real estate	28,892	416	5.75		28,735	382	5.19		14,066	90	2.57		157	34	56	14,826	326	318
Leases	1,436	12	3.33		1,422	12	3.25		1,560	11	2.81		14	—	8	(124)	1	52
Total commercial	82,321	1,163	5.65		82,468	1,046	4.97		60,573	429	2.83		(147)	117	68	21,748	734	282
Residential mortgages	30,075	250	3.33		29,677	246	3.32		23,461	169	2.88		398	4	1	6,614	81	45
Home equity	14,073	240	6.92		13,869	204	5.84		12,124	90	3.02		204	36	108	1,949	150	390
Automobile	11,937	119	4.04		12,692	125	3.90		14,534	127	3.55		(755)	(6)	14	(2,597)	(8)	49
Education	12,796	154	4.88		12,929	148	4.54		13,034	131	4.07		(133)	6	34	(238)	23	81
Other retail	5,290	121	9.25		5,464	124	9.02		5,428	102	7.63		(174)	(3)	23	(138)	19	162
Total retail	74,171	884	4.81		74,631	847	4.52		68,581	619	3.65		(460)	37	29	5,590	265	116
Total loans and leases	156,492	2,047	5.25		157,099	1,893	4.75		129,154	1,048	3.26		(607)	154	50	27,338	999	199
Loans held for sale, at fair value	1,009	15	5.87		1,179	16	5.32		2,366	16	2.70		(170)	(1)	55	(1,357)	(1)	317
Other loans held for sale	197	5	9.98		557	10	6.70		454	7	5.89		(360)	(5)	328	(257)	(2)	409
Total interest-earning assets	202,552	2,402	4.76		204,522	2,252	4.35		169,276	1,213	2.88		(1,970)	150	41	33,276	1,189	188


Noninterest-earning assets	20,159				20,448				19,041				(289)			1,118
TOTAL ASSETS	$222,711				$224,970				$188,317				($2,259)			$34,394
INTEREST-BEARING LIABILITIES
Checking with interest	$35,974	97	1.09		$36,952	77	0.82		$30,417	5	0.07		($978)	20	27	$5,557	$92	102
Money market	49,942	287	2.33		50,228	208	1.65		47,220	12	0.10		(286)	79	68	2,722	275	223
Regular savings	29,460	79	1.09		29,780	58	0.78		23,835	5	0.08		(320)	21	31	5,625	74	101
Term	12,839	87	2.72		11,378	53	1.83		4,970	3	0.29		1,461	34	89	7,869	84	243
Total interest-bearing deposits	128,215	550	1.74		128,338	396	1.23		106,442	25	0.10		(123)	154	51	21,773	525	164
Short-term borrowed funds	542	6	4.97		262	2	3.83		29	—	3.50		280	4	114	513	6	147
FHLB advances	10,362	121	4.68		8,818	82	3.67		20	—	0.81		1,544	39	101	10,342	121	387
Senior debt	5,606	61	4.39		5,397	55	4.05		4,461	24	2.12		209	6	34	1,145	37	227
Subordinated debt and other debt	1,812	21	4.37		1,812	22	4.59		1,585	17	4.21		—	(1)	(22)	227	4	16
Total long-term borrowed funds	17,780	203	4.55		16,027	159	3.91		6,066	41	2.66		1,753	44	64	11,714	162	189
Total borrowed funds	18,322	209	4.57		16,289	161	3.90		6,095	41	2.66		2,033	48	67	12,227	168	191
Total interest-bearing liabilities	146,537	759	2.09		144,627	557	1.53		112,537	66	0.23		1,910	202	56	34,000	693	186
Demand deposits	46,135				50,706				48,641				(4,571)			(2,506)
Other noninterest-bearing liabilities	6,323				6,347				4,144				(24)			2,179
TOTAL LIABILITIES	198,995				201,680				165,322				(2,685)			33,673
STOCKHOLDERS' EQUITY	23,716				23,290				22,995				426			721
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$222,711				$224,970				$188,317				($2,259)			$34,394
INTEREST RATE SPREAD			2.67	%			2.82	%			2.65	%			(15)			2
NET INTEREST MARGIN AND NET INTEREST INCOME		$1,643	3.29	%		$1,695	3.29	%		$1,147	2.75	%		($52)	—		$496	54
NET INTEREST MARGIN AND NET INTEREST INCOME, FTE1		$1,647	3.30	%		$1,699	3.30	%		$1,149	2.75	%		($52)	—		$498	55
Memo: Total deposits (interest-bearing and demand)	$174,350	$550	1.28	%	$179,044	$396	0.88	%	$155,083	$25	0.07	%	($4,694)	$154	40 bps	$19,267	$525	121 bps

1Net interest income and net interest margin is presented on a fully taxable-equivalent ("FTE") basis using the federal statutory tax rate of 21%. The FTE impact is predominantly attributable to commercial loans for the periods presented.

MORTGAGE BANKING FEES SUMMARY

(in millions, except ratio data)


	QUARTERLY TRENDS
											1Q23 Change
	1Q23		4Q22		3Q22		2Q22		1Q22		4Q22				1Q22
											$/bps		%		$/bps		%
MORTGAGE BANKING FEES
Production revenue	$18		$12		$19		$22		$31		$6		50	%	($13)		(42	%)
Mortgage servicing revenue	37		40		40		39		28		(3)		(8)		9		32
MSR valuation changes, net of hedge impact	2		2		7		11		10		—		—		(8)		(80)
Total mortgage banking fees	$57		$54		$66		$72		$69		$3		6	%	($12)		(17	%)

Pull-through adjusted locks	$2,078		$1,665		$2,979		$3,833		$4,936		$413		25	%	($2,858)		(58	%)

Production revenue as a percentage of Pull-through adjusted locks	0.90	%	0.72	%	0.64	%	0.57	%	0.63	%	18	bps			27	bps



RESIDENTIAL REAL ESTATE ORIGINATIONS
Retail	$1,011		$1,103		$1,799		$2,774		$3,275		($92)		(8	%)	($2,264)		(69	%)
Third Party	1,333		1,652		2,642		3,624		4,101		(319)		(19)		(2,768)		(67)
Total	$2,344		$2,755		$4,441		$6,398		$7,376		($411)		(15	%)	(5,032)		(68	%)

Originated for sale	$1,651		$2,044		$3,212		$4,296		$5,521		($393)		(19	%)	($3,870)		(70	%)
Originated for investment	693		711		1,229		2,102		1,855		(18)		(3)		(1,162)		(63)
Total	$2,344		$2,755		$4,441		$6,398		$7,376		($411)		(15	%)	($5,032)		(68	%)

MORTGAGE SERVICING INFORMATION (UPB)
Loans serviced for others	$96,346		$96,698		$96,415		$95,489		$92,804		($352)		—	%	$3,542		4	%
Owned loans serviced	30,827		30,135		30,081		29,893		25,283		692		2		5,544		22
Total	$127,173		$126,833		$126,496		$125,382		$118,087		$340		—	%	$9,086		8	%

MSR at fair value	$1,496		$1,530		$1,524		$1,411		$1,241		($34)		(2	%)	$255		21	%

SEGMENT FINANCIAL HIGHLIGHTS - CONSUMER BANKING

(in millions, except ratio data)


	QUARTERLY TRENDS
CONSUMER BANKING											1Q23 Change
	1Q23		4Q22		3Q22		2Q22		1Q22		4Q22				1Q22
											$/bps		%		$/bps		%
Net interest income	$1,096		$1,106		$1,085		$995		$857		($10)		(1	%)	$239		28	%
Noninterest income	256		256		270		280		257		—		—		(1)		—
Total revenue	1,352		1,362		1,355		1,275		1,114		(10)		(1)		238		21
Noninterest expense	889		863		863		881		784		26		3		105		13
Profit before provision (benefit) for credit losses	463		499		492		394		330		(36)		(7)		133		40
Net charge-offs	83		76		62		39		49		7		9		34		69
Income before income tax expense	380		423		430		355		281		(43)		(10)		99		35
Income tax expense	99		108		111		90		72		(9)		(8)		27		38
Net income	$281		$315		$319		$265		$209		($34)		(11	%)	$72		34	%
AVERAGE BALANCES
Total assets	$87,558		$88,440		$89,560		$88,881		$77,551		($882)		(1	%)	$10,007		13	%
Total loans and leases1	81,190		82,302		83,373		83,248		73,233		(1,112)		(1)		7,957		11
Deposits	115,578		117,164		117,448		118,482		104,663		(1,586)		(1)		10,915		10
Interest-earning assets	81,871		83,021		84,122		84,026		74,052		(1,150)		(1)		7,819		11
KEY METRICS
Net interest margin	5.44	%	5.28	%	5.12	%	4.75	%	4.69	%	16	bps			75	bps
Efficiency ratio	65.81		63.38		63.76		69.06		70.38		243	bps			(457)	bps
Loan-to-deposit ratio (period-end balances)	69.40		68.55		67.38		69.04		66.23		85	bps			317	bps
Loan-to-deposit ratio (average balances)	69.77		69.38		69.63		68.60		68.04		39	bps			173	bps
Return on average total tangible assets	1.31		1.42		1.43		1.20		1.10		(11)	bps			21	bps

1Includes loans held for sale.

SEGMENT FINANCIAL HIGHLIGHTS - COMMERCIAL BANKING

(in millions, except ratio data)


	QUARTERLY TRENDS
COMMERCIAL BANKING											1Q23 Change
	1Q23		4Q22		3Q22		2Q22		1Q22		4Q22				1Q22
											$/bps		%		$/bps		%
Net interest income	$597		$594		$559		$534		$416		$3		1	%	$181		44	%
Noninterest income	201		198		213		221		213		3		2		(12)		(6)
Total revenue	798		792		772		755		629		6		1		169		27
Noninterest expense	331		318		325		308		272		13		4		59		22
Profit before provision (benefit) for credit losses	467		474		447		447		357		(7)		(1)		110		31
Net charge-offs	47		12		12		10		12		35		NM		35		NM
Income before income tax expense	420		462		435		437		345		(42)		(9)		75		22
Income tax expense	101		104		101		96		74		(3)		(3)		27		36
Net income	$319		$358		$334		$341		$271		($39)		(11	%)	$48		18	%
AVERAGE BALANCES
Total assets	$78,891		$79,591		$80,067		$78,638		$61,118		($700)		(1	%)	$17,773		29	%
Total loans and leases1	75,734		75,773		75,767		74,172		58,007		(39)		—		17,727		31
Deposits	48,966		52,303		51,095		51,575		44,520		(3,337)		(6)		4,446		10
Interest-earning assets	76,130		76,097		76,025		74,422		58,312		33		—		17,818		31
KEY METRICS
Net interest margin	3.18	%	3.10	%	2.91	%	2.88	%	2.89	%	8	bps			29	bps
Efficiency ratio	41.47		40.18		42.04		40.78		43.32		129	bps			(185)	bps
Loan-to-deposit ratio (period-end balances)	162.54		141.44		142.25		142.31		132.70		2,110	bps			2,984	bps
Loan-to-deposit ratio (average balances)	153.33		143.49		145.57		139.31		128.49		984	bps			2,484	bps
Return on average total tangible assets	1.66		1.80		1.68		1.75		1.81		(14)	bps			(15)	bps

1Includes loans held for sale.

SEGMENT FINANCIAL HIGHLIGHTS - OTHER

(in millions)


	QUARTERLY TRENDS
OTHER1						1Q23 Change
	1Q23	4Q22	3Q22	2Q22	1Q22	4Q22			1Q22
						$	%		$	%
Net interest income	($50)	($5)	$21	($24)	($126)	($45)	NM		$76	60	%
Noninterest income	28	51	29	(7)	28	(23)	(45)		—	—
Total revenue	(22)	46	50	(31)	(98)	(68)	NM		76	78
Noninterest expense	76	59	53	116	50	17	29		26	52
Loss before provision (benefit) for credit losses	(98)	(13)	(3)	(147)	(148)	(85)	NM		50	34
Provision (benefit) for credit losses	38	44	49	167	(58)	(6)	(14)		96	NM
Loss before income tax benefit	(136)	(57)	(52)	(314)	(90)	(79)	(139)		(46)	(51)
Income tax benefit	(47)	(37)	(35)	(72)	(30)	(10)	(27)		(17)	(57)
Net loss	($89)	($20)	($17)	($242)	($60)	($69)	NM		($29)	(48)
AVERAGE BALANCES
Total assets	$56,262	$56,939	$55,846	$53,448	$49,648	($677)	(1	%)	$6,614	13	%
Total loans and leases2	773	760	724	724	735	13	2		38	5
Deposits	9,806	9,577	9,075	6,305	5,900	229	2		3,906	66
Interest-earning assets	44,550	45,405	43,428	40,228	36,913	(855)	(2)		7,637	21

1Includes assets, liabilities, capital, revenues, provision for credit losses, expenses and income tax expense not attributed to our Consumer or Commercial Banking segments as well as treasury and community development.

2Includes loans held for sale.

CREDIT-RELATED INFORMATION

(in millions, except ratio data)


	AS OF										MARCH 31, 2023 CHANGE
	Mar 31, 2023		Dec 31, 2022		Sept 30, 2022		June 30, 2022		Mar 31, 2022		Dec 31, 2022				March 31, 2022
											$/bps/%		%		$/bps/%		%
NONACCRUAL LOANS AND LEASES
Commercial and industrial	$297		$249		$234		$202		$200		$48		19	%	$97		49	%
Commercial real estate	140		103		37		37		11		37		36		129		NM
Leases	—		—		—		—		1		—		—		(1)		(100)
Total commercial	437		352		271		239		212		85		24		225		106
Residential mortgages1	216		234		236		253		243		(18)		(8)		(27)		(11)
Home equity	240		241		235		240		239		(1)		—		1		—
Automobile	50		56		52		50		52		(6)		(11)		(2)		(4)
Education	23		33		33		31		23		(10)		(30)		—		—
Other retail	30		28		25		26		20		2		7		10		50
Total retail	559		592		581		600		577		(33)		(6)		(18)		(3)
Nonaccrual loans and leases	996		944		852		839		789		52		6		207		26
Repossessed assets	14		16		16		15		15		(2)		(13)		(1)		(7)
Nonaccrual loans and leases and repossessed assets	$1,010		$960		$868		$854		$804		$50		5	%	$206		26	%
NONACCRUAL LOANS AND LEASES BY PRODUCT2
Commercial	$437		$352		$271		$239		$212		$85		24	%	$225		106	%
Retail	573		608		597		615		592		(35)		(6)		(19)		(3)
Total nonaccrual loans and leases	$1,010		$960		$868		$854		$804		$50		5	%	$206		26	%
ASSET QUALITY RATIOS
Allowance for loan and lease losses to loans and leases	1.30	%	1.27	%	1.27	%	1.26	%	1.31	%	3	bps			(1)	bps
Allowance for credit losses to loans and leases	1.47		1.43		1.41		1.37		1.43		4				4
Allowance for loan and lease losses to nonaccrual loans and leases	203		210		232		234		218		(7	%)			(15	%)
Allowance for credit losses to nonaccrual loans and leases	229		237		258		256		238		(8	%)			(9	%)
Nonaccrual loans and leases to loans and leases	0.64		0.60		0.55		0.54		0.60		4	bps			4	bps

1Loans fully or partially guaranteed by the FHA, VA and USDA are classified as accruing.

2Nonaccrual loans and leases by product includes repossessed assets.

CREDIT-RELATED INFORMATION, CONTINUED

(in millions, except ratio data)


	AS OF					MARCH 31, 2023 CHANGE
	Mar 31, 2023	Dec 31, 2022	Sept 30, 2022	June 30, 2022	Mar 31, 2022	Dec 31, 2022			March 31, 2022
						$/bps	%		$/bps	%
LOANS AND LEASES 90 DAYS OR MORE PAST DUE AND ACCRUING
Commercial and industrial	$21	$21	$13	$39	$13	$—	—	%	$8	62	%
Commercial real estate	63	1	2	33	—	62	NM		63	100
Leases	—	—	—	—	5	—	—		(5)	(100)
Total commercial	84	22	15	72	18	62	NM		66	NM
Residential mortgages1	314	319	425	623	792	(5)	(2)		(478)	(60)


Education	3	4	4	3	2	(1)	(25)		1	50
Other retail	23	22	18	14	14	1	5		9	64
Total retail	340	345	447	640	808	(5)	(1)		(468)	(58)
Total loans and leases	$424	$367	$462	$712	$826	$57	16	%	($402)	(49	%)

1 90+ days past due and accruing includes $309 million, $316 million, $425 million, $623 million, and $792 million of loans fully or partially guaranteed by the FHA, VA, and USDA for March 31, 2023, December 31, 2022, September 30, 2022, June 30, 2022 and March 31, 2022, respectively.

CREDIT-RELATED INFORMATION, CONTINUED

(in millions)


	QUARTERLY TRENDS
						1Q23 Change
	1Q23	4Q22	3Q22	2Q22	1Q22	4Q22			1Q22
						$	%		$	%
CHARGE-OFFS, RECOVERIES AND RELATED RATIOS
GROSS CHARGE-OFFS
Commercial and industrial	$55	$21	$20	$13	$14	$34	162	%	$41	NM
Commercial real estate	4	—	2	—	—	4	100		4	100
Leases	—	—	—	—	—	—	—		—	—
Total commercial	59	21	22	13	14	38	181		45	NM
Residential mortgages	1	1	1	1	2	—	—		(1)	(50)
Home equity	2	2	3	2	2	—	—		—	—
Automobile	30	27	24	21	21	3	11		9	43
Education	23	24	18	16	20	(1)	(4)		3	15
Other retail	56	51	48	38	42	5	10		14	33
Total retail	112	105	94	78	87	7	7		25	29
Total gross charge-offs	$171	$126	$116	$91	$101	$45	36	%	$70	69	%
GROSS RECOVERIES
Commercial and industrial	$3	$5	$6	$3	$3	($2)	(40	%)	$—	—	%
Commercial real estate	1	—	1	—	—	1	100		1	100
Leases	3	—	—	—	—	3	100		3	100
Total commercial	7	5	7	3	3	2	40		4	133
Residential mortgages	—	1	1	2	2	(1)	(100)		(2)	(100)
Home equity	5	6	9	11	11	(1)	(17)		(6)	(55)
Automobile	15	14	13	15	15	1	7		—	—
Education	5	5	5	5	4	—	—		1	25
Other retail	6	7	7	6	7	(1)	(14)		(1)	(14)
Total retail	31	33	35	39	39	(2)	(6)		(8)	(21)
Total gross recoveries	$38	$38	$42	$42	$42	$—	—	%	($4)	(10	%)
NET CHARGE-OFFS (RECOVERIES)
Commercial and industrial	$52	$16	$14	$10	$11	$36	225	%	$41	NM
Commercial real estate	3	—	1	—	—	3	100		3	100
Leases	(3)	—	—	—	—	(3)	(100)		(3)	(100)
Total commercial	52	16	15	10	11	36	225		41	NM
Residential mortgages	1	—	—	(1)	—	1	100		1	100
Home equity	(3)	(4)	(6)	(9)	(9)	1	25		6	67
Automobile	15	13	11	6	6	2	15		9	150
Education	18	19	13	11	16	(1)	(5)		2	13
Other retail	50	44	41	32	35	6	14		15	43
Total retail	81	72	59	39	48	9	13		33	69
Total net charge-offs	$133	$88	$74	$49	$59	$45	51	%	$74	125	%

CREDIT-RELATED INFORMATION, CONTINUED

(in millions, except rates)


	QUARTERLY TRENDS
											1Q23 Change
	1Q23		4Q22		3Q22		2Q22		1Q22		4Q22				1Q22
											$/bps		%		$/bps		%
ANNUALIZED NET CHARGE-OFF (RECOVERY) RATES
Commercial and industrial	0.40	%	0.12	%	0.11	%	0.08	%	0.10	%	28	bps			30	bps
Commercial real estate	0.05		—		0.01		—		—		5				5
Leases	(0.85)		(0.06)		(0.11)		(0.05)		0.10		(79)				(95)
Total commercial	0.26		0.07		0.07		0.05		0.08		19				18
Residential mortgages	0.01		—		0.01		(0.01)		—		1				1
Home equity	(0.07)		(0.12)		(0.17)		(0.27)		(0.32)		5				25
Automobile	0.51		0.42		0.31		0.16		0.18		9				33
Education	0.57		0.59		0.38		0.34		0.49		(2)				8
Other retail	3.81		3.21		3.02		2.25		2.61		60				120
Total retail	0.44		0.39		0.32		0.21		0.28		5				16
Total loans and leases	0.34	%	0.22	%	0.19	%	0.13	%	0.19	%	12	bps			15	bps
Memo: Average loans
Commercial and industrial	$51,993		$52,311		$52,130		$50,517		$44,947		($318)		(1	%)	$7,046		16	%
Commercial real estate	28,892		28,735		28,388		27,592		14,066		157		1		14,826		105
Leases	1,436		1,422		1,529		1,575		1,560		14		1		(124)		(8)
Total commercial	82,321		82,468		82,047		79,684		60,573		(147)		—		21,748		36
Residential mortgages	30,075		29,677		29,327		28,486		23,461		398		1		6,614		28
Home equity	14,073		13,869		13,400		12,811		12,124		204		1		1,949		16
Automobile	11,937		12,692		13,540		14,172		14,534		(755)		(6)		(2,597)		(18)
Education	12,796		12,929		13,081		13,144		13,034		(133)		(1)		(238)		(2)
Other retail	5,290		5,464		5,484		5,557		5,428		(174)		(3)		(138)		(3)
Total retail	74,171		74,631		74,832		74,170		68,581		(460)		(1)		5,590		8
Total loans and leases	$156,492		$157,099		$156,879		$153,854		$129,154		($607)		—	%	$27,338		21	%

CREDIT-RELATED INFORMATION, CONTINUED

(in millions)


	QUARTERLY TRENDS
						1Q23 Change
	1Q23	4Q22	3Q22	2Q22	1Q22	4Q22			1Q22
						$	%		$	%
SUMMARY OF CHANGES IN THE COMPONENTS OF THE ALLOWANCE FOR CREDIT LOSSES
Allowance for loan and lease losses - beginning	$1,983	$1,980	$1,964	$1,720	$1,758	$3	—	%	$225	13	%





Allowance on PCD loans and leases at acquisition:
Commercial	—	—	—	99	—	—	—		—	—
Retail	—	—	—	2	—	—	—		—	—
Total Allowance on PCD loans and leases at acquisition	—	—	—	101	—	—	—		—	—
Charge-offs:
Commercial	59	21	22	13	14	38	181		45	NM
Retail	112	105	94	78	87	7	7		25	29
Total charge-offs	171	126	116	91	101	45	36		70	69
Recoveries:
Commercial	7	5	7	3	3	2	40		4	133
Retail	31	33	35	39	39	(2)	(6)		(8)	(21)
Total recoveries	38	38	42	42	42	—	—		(4)	(10)
Net charge-offs	133	88	74	49	59	45	51		74	125
Provision (benefit) for loan and lease losses:
Commercial	103	46	58	120	(32)	57	124		135	NM
Retail	64	45	32	72	53	19	42		11	21
Total provision (benefit) for loan and lease losses	167	91	90	192	21	76	84		146	NM
Allowance for loan and lease losses - ending	$2,017	$1,983	$1,980	$1,964	$1,720	$34	2	%	$297	17	%

Allowance for unfunded lending commitments - beginning	$257	$216	$183	$158	$176	$41	19	%	$81	46	%

Allowance on PCD unfunded lending commitments at acquisition	—	—	—	1	—	—	—	%	—	—
Provision (benefit) for unfunded lending commitments	1	41	33	24	(18)	(40)	(98	%)	19	NM
Allowance for unfunded lending commitments - ending	$258	$257	$216	$183	$158	$1	—	%	$100	63
Total allowance for credit losses - ending	$2,275	$2,240	$2,196	$2,147	$1,878	$35	2	%	$397	21	%

Memo: Total allowance for credit losses by product
Commercial	$1,326	$1,267	$1,202	$1,153	$925	$59	5	%	$401	43	%
Retail	949	973	994	994	953	(24)	(2)		(4)	—
Total allowance for credit losses	$2,275	$2,240	$2,196	$2,147	$1,878	$35	2	%	$397	21	%

CAPITAL AND RATIOS

(in millions, except ratio data)


	AS OF
											MARCH 31, 2023 CHANGE
	Mar 31, 2023		Dec 31, 2022		Sept 30, 2022		June 30, 2022		Mar 31, 2022		Dec 31, 2022			March 31, 2022
											$	%		$	%
CAPITAL RATIOS AND COMPONENTS (PRELIMINARY)
CET1 capital	$18,370		$18,574		$18,304		$17,946		$15,643		($204)	(1	%)	$2,727	17	%
Tier 1 capital	20,384		20,588		20,318		19,960		17,657		(204)	(1)		2,727	15
Total capital	23,720		23,755		23,516		23,184		20,301		(35)	—		3,419	17
Risk-weighted assets	183,246		185,224		187,201		187,727		161,859		(1,978)	(1)		21,387	13
Adjusted average assets1	217,998		220,779		220,076		215,727		183,089		(2,781)	(1)		34,909	19
CET1 capital ratio	10.0	%	10.0	%	9.8	%	9.6	%	9.7	%
Tier 1 capital ratio	11.1		11.1		10.9		10.6		10.9
Total capital ratio	12.9		12.8		12.6		12.3		12.5
Tier 1 leverage ratio	9.4		9.3		9.2		9.3		9.6
TANGIBLE COMMON EQUITY (PERIOD-END)
Common stockholders' equity	$22,187		$21,676		$21,132		$22,314		$20,060		$511	2	%	$2,127	11	%
Less: Goodwill	8,177		8,173		8,160		8,081		7,232		4	—		945	13
Less: Other intangible assets	185		197		199		211		115		(12)	(6)		70	61
Add: Deferred tax liabilities2	422		422		424		422		387		—	—		35	9
Total tangible common equity	$14,247		$13,728		$13,197		$14,444		$13,100		$519	4	%	$1,147	9	%
TANGIBLE COMMON EQUITY (AVERAGE)
Common stockholders' equity	$21,702		$21,276		$22,246		$22,383		$20,981		$426	2	%	$721	3	%
Less: Goodwill	8,177		8,171		8,131		8,015		7,156		6	—		1,021	14
Less: Other intangible assets	192		199		228		213		80		(7)	(4)		112	140
Add: Deferred tax liabilities2	422		424		424		416		383		(2)	—		39	10
Total tangible common equity	$13,755		$13,330		$14,311		$14,571		$14,128		$425	3	%	($373)	(3	%)
INTANGIBLE ASSETS (PERIOD-END)
Goodwill	$8,177		$8,173		$8,160		$8,081		$7,232		$4	—	%	$945	13	%
Other intangible assets	185		197		199		211		115		(12)	(6)		70	61
Total intangible assets	$8,362		$8,370		$8,359		$8,292		$7,347		($8)	—	%	$1,015	14	%

1Adjusted average assets include quarterly average assets, less deductions for disallowed goodwill and other intangible assets, net of deferred taxes, and the accumulated other comprehensive
income impact related to the adoption of post-retirement benefit plan guidance under GAAP.

2Deferred tax liabilities relate to tax-deductible goodwill and other intangible assets.

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

(in millions, except share, per-share and ratio data)

Non-GAAP Financial Measures

This document contains non-GAAP financial measures denoted as Underlying. Underlying results for any given reporting period exclude certain items that may occur in that period which management does not consider indicative of the Company’s on-going financial performance. We believe these non-GAAP financial measures provide useful information to investors because they are used by our management to evaluate our operating performance and make day-to-day operating decisions. In addition, we believe our Underlying results in any given reporting period reflect our on-going financial performance in that period and, accordingly, are useful to consider in addition to our GAAP financial results. The following tables present reconciliations of our non-GAAP measures to the most directly comparable GAAP financial measures.

Other companies may use similarly titled non-GAAP financial measures that are calculated differently from the way we calculate such measures. Accordingly, our non-GAAP financial measures may not be comparable to similar measures used by such companies. We caution investors not to place undue reliance on such non-GAAP financial measures, but to consider them with the most directly comparable GAAP measures. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for our results reported under GAAP.

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS, CONTINUED

(in millions, except share, per-share and ratio data)


		QUARTERLY TRENDS
							1Q23 Change
		1Q23	4Q22	3Q22	2Q22	1Q22	4Q22			1Q22
							$	%		$	%
Noninterest income, Underlying:
Noninterest income (GAAP)	A	$485	$505	$512	$494	$498	($20)	(4	%)	($13)	(3	%)
Less: Notable items		—	—	—	(31)	—	—	—		—	—
Noninterest income, Underlying (non-GAAP)	B	$485	$505	$512	$525	$498	($20)	(4	%)	($13)	(3	%)
Total revenue, Underlying:
Total revenue (GAAP)	C	$2,128	$2,200	$2,177	$1,999	$1,645	($72)	(3	%)	$483	29	%
Less: Notable items		—	—	—	(31)	—	—	—		—	—
Total revenue, Underlying (non-GAAP)	D	$2,128	$2,200	$2,177	$2,030	$1,645	($72)	(3	%)	$483	29	%
Noninterest expense, Underlying:
Noninterest expense (GAAP)	E	$1,296	$1,240	$1,241	$1,305	$1,106	$56	5	%	$190	17	%
Less: Notable items		66	43	46	125	48	23	53		18	38
Noninterest expense, Underlying (non-GAAP)	F	$1,230	$1,197	$1,195	$1,180	$1,058	$33	3	%	$172	16	%
Pre-provision profit:
Total revenue (GAAP)	C	$2,128	$2,200	$2,177	$1,999	$1,645	($72)	(3	%)	$483	29	%
Less: Noninterest expense (GAAP)	E	1,296	1,240	1,241	1,305	1,106	56	5		190	17
Pre-provision profit (GAAP)		$832	$960	$936	$694	$539	($128)	(13	%)	$293	54	%
Pre-provision profit, Underlying:
Total revenue, Underlying (non-GAAP)	D	$2,128	$2,200	$2,177	$2,030	$1,645	($72)	(3	%)	$483	29	%
Less: Noninterest expense, Underlying (non-GAAP)	F	1,230	1,197	1,195	1,180	1,058	33	3		172	16
Pre-provision profit, Underlying (non-GAAP)		$898	$1,003	$982	$850	$587	($105)	(10	%)	$311	53	%
Provision (benefit) for credit losses, Underlying:
Provision (benefit) for credit losses (GAAP)		$168	$132	$123	$216	$3	$36	27	%	$165	NM
Less: Notable items		—	—	—	145	24	—	—		(24)	(100)
Provision (benefit) for credit losses, Underlying (non-GAAP)		$168	$132	$123	$71	($21)	$36	27	%	$189	NM
Income before income tax expense, Underlying:
Income before income tax expense (GAAP)	G	$664	$828	$813	$478	$536	($164)	(20	%)	$128	24	%
Less: Expense before income tax benefit related to notable items		(66)	(43)	(46)	(301)	(72)	(23)	(53)		6	8
Income before income tax expense, Underlying (non-GAAP)	H	$730	$871	$859	$779	$608	($141)	(16	%)	$122	20	%
Income tax expense, Underlying:
Income tax expense (GAAP)	I	$153	$175	$177	$114	$116	($22)	(13	%)	$37	32	%
Less: Income tax benefit related to notable items		(17)	(11)	(13)	(70)	(16)	(6)	(55)		(1)	(6)
Income tax expense, Underlying (non-GAAP)	J	$170	$186	$190	$184	$132	($16)	(9	%)	$38	29	%
Net income, Underlying:
Net income (GAAP)	K	$511	$653	$636	$364	$420	($142)	(22	%)	$91	22	%
Add: Notable items, net of income tax benefit		49	32	33	231	56	17	53		(7)	(13)
Net income, Underlying (non-GAAP)	L	$560	$685	$669	$595	$476	($125)	(18	%)	$84	18	%
Net income available to common stockholders, Underlying:
Net income available to common stockholders (GAAP)	M	$488	$621	$611	$332	$396	($133)	(21	%)	$92	23	%
Add: Notable items, net of income tax benefit		49	32	33	231	56	17	53		(7)	(13)
Net income available to common stockholders, Underlying (non-GAAP)	N	$537	$653	$644	$563	$452	($116)	(18	%)	$85	19	%

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS, CONTINUED

(in millions, except share, per-share and ratio data)


		QUARTERLY TRENDS
												1Q23 Change
		1Q23		4Q22		3Q22		2Q22		1Q22		4Q22				1Q22
												$/bps		%		$/bps		%
Operating leverage:
Total revenue (GAAP)	C	$2,128		$2,200		$2,177		$1,999		$1,645		($72)		(3.28	%)	$483		29.39	%
Less: Noninterest expense (GAAP)	E	1,296		1,240		1,241		1,305		1,106		56		4.53		190		17.22
Operating leverage														(7.81	%)			12.17	%
Operating leverage, Underlying:
Total revenue, Underlying (non-GAAP)	D	$2,128		$2,200		$2,177		$2,030		$1,645		($72)		(3.27	%)	$483		29.39	%
Less: Noninterest expense, Underlying (non-GAAP)	F	1,230		1,197		1,195		1,180		1,058		33		2.80		172		16.43
Operating leverage, Underlying (non-GAAP)														(6.07	%)			12.96	%
Efficiency ratio and efficiency ratio, Underlying:
Efficiency ratio	E/C	60.90	%	56.36	%	57.02	%	65.27	%	67.23	%	454	bps			(633)	bps
Efficiency ratio, Underlying (non-GAAP)	F/D	57.84		54.42		54.90		58.16		64.28		342	bps			(644)	bps
Noninterest income as a % of total revenue, Underlying:
Noninterest income as a % of total revenue	A/C	22.81	%	22.92	%	23.54	%	24.72	%	30.26	%	(11)	bps			(745)	bps
Noninterest income as a % of total revenue, Underlying	B/D	22.81		22.92		23.54		25.88		30.26		(11)	bps			(745)	bps
Effective income tax rate and effective income tax rate, Underlying:
Effective income tax rate	I/G	22.97	%	21.16	%	21.80	%	23.77	%	21.70	%	181	bps			127	bps
Effective income tax rate, Underlying (non-GAAP)	J/H	23.25		21.37		22.00		23.69		21.70		188	bps			155	bps
Return on average common equity and return on average common equity, Underlying:
Average common equity (GAAP)	O	$21,702		$21,276		$22,246		$22,383		$20,981		$426		2	%	$721		3	%
Return on average common equity	M/O	9.11	%	11.56	%	10.91	%	5.95	%	7.65	%	(245)	bps			146	bps
Return on average common equity, Underlying (non-GAAP)	N/O	10.01		12.15		11.52		10.06		8.75		(214)	bps			126	bps
Return on average tangible common equity and return on average tangible common equity, Underlying:
Average common equity (GAAP)	O	$21,702		$21,276		$22,246		$22,383		$20,981		$426		2	%	$721		3	%
Less: Average goodwill (GAAP)		8,177		8,171		8,131		8,015		7,156		6		—		1,021		14
Less: Average other intangibles (GAAP)		192		199		228		213		80		(7)		(4)		112		140
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP)		422		424		424		416		383		(2)		—		39		10
Average tangible common equity	P	$13,755		$13,330		$14,311		$14,571		$14,128		$425		3	%	($373)		(3	%)
Return on average tangible common equity	M/P	14.38	%	18.46	%	16.96	%	9.13	%	11.36	%	(408)	bps			302	bps
Return on average tangible common equity, Underlying (non-GAAP)	N/P	15.80		19.40		17.91		15.45		12.99		(360)	bps			281	bps
Return on average total assets and return on average total assets, Underlying:
Average total assets (GAAP)	Q	$222,711		$224,970		$225,473		$220,967		$188,317		($2,259)		(1	%)	$34,394		18	%
Return on average total assets	K/Q	0.93	%	1.15	%	1.12	%	0.66	%	0.90	%	(22)	bps			3	bps
Return on average total assets, Underlying (non-GAAP)	L/Q	1.02		1.21		1.18		1.08		1.03		(19)	bps			(1)	bps

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS, CONTINUED

(in millions, except share, per-share and ratio data)


		QUARTERLY TRENDS
												1Q23 Change
		1Q23		4Q22		3Q22		2Q22		1Q22		4Q22				1Q22
												$/bps		%		$/bps		%
Return on average total tangible assets and return on average total tangible assets, Underlying:
Average total assets (GAAP)	Q	$222,711		$224,970		$225,473		$220,967		$188,317		($2,259)		(1	%)	$34,394		18	%
Less: Average goodwill (GAAP)		8,177		8,171		8,131		8,015		7,156		6		—		1,021		14
Less: Average other intangibles (GAAP)		192		199		228		213		80		(7)		(4)		112		140
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP)		422		424		424		416		383		(2)		—		39		10
Average tangible assets	R	$214,764		$217,024		$217,538		$213,155		$181,464		($2,260)		(1	%)	$33,300		18	%
Return on average total tangible assets	K/R	0.97	%	1.19	%	1.16	%	0.69	%	0.94	%	(22)	bps			3	bps
Return on average total tangible assets, Underlying (non-GAAP)	L/R	1.06		1.25		1.22		1.12		1.06		(19)	bps			—	bps
Tangible book value per common share:
Common shares - at period-end (GAAP)	S	483,982,264		492,282,158		495,843,793		495,650,259		423,031,985		(8,299,894)		(2	%)	60,950,279		14	%
Common stockholders' equity (GAAP)		$22,187		$21,676		$21,132		$22,314		$20,060		$511		2		$2,127		11
Less: Goodwill (GAAP)		8,177		8,173		8,160		8,081		7,232		4		—		945		13
Less: Other intangible assets (GAAP)		185		197		199		211		115		(12)		(6)		70		61
Add: Deferred tax liabilities related to goodwill and other intangible assets (GAAP)		422		422		424		422		387		—		—		35		9
Tangible common equity	T	$14,247		$13,728		$13,197		$14,444		$13,100		$519		4	%	$1,147		9	%
Tangible book value per common share	T/S	$29.44		$27.88		$26.62		$29.14		$30.97		$1.56		6	%	($1.53)		(5	%)
Net income per average common share - basic and diluted and net income per average common share - basic and diluted, Underlying:
Average common shares outstanding - basic (GAAP)	U	485,444,313		493,293,981		495,651,083		491,497,026		422,401,747		(7,849,668)		(2	%)	63,042,566		15	%
Average common shares outstanding - diluted (GAAP)	V	487,712,146		495,478,398		497,477,501		493,296,114		424,670,871		(7,766,252)		(2)		63,041,275		15
Net income per average common share - basic (GAAP)	M/U	$1.00		$1.26		$1.23		$0.68		$0.94		($0.26)		(21)		$0.06		6
Net income per average common share - diluted (GAAP)	M/V	1.00		1.25		1.23		0.67		0.93		(0.25)		(20)		0.07		8
Net income per average common share - basic, Underlying (non-GAAP)	N/U	1.10		1.32		1.30		1.14		1.07		(0.22)		(17)		0.03		3
Net income per average common share - diluted, Underlying (non-GAAP)	N/V	1.10		1.32		1.30		1.14		1.07		(0.22)		(17)		0.03		3
Dividend payout ratio and dividend payout ratio, Underlying:
Cash dividends declared and paid per common share	W	$0.42		$0.42		$0.42		$0.39		$0.39		$—		—	%	$0.03		8	%
Dividend payout ratio	W/(M/U)	42	%	33	%	34	%	57	%	41	%	900 bps				100 bps
Dividend payout ratio, Underlying (non-GAAP)	W/(N/U)	38		32		32		34		36		600 bps				200 bps

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS, CONTINUED

(in millions, except share, per-share and ratio data)


	QUARTERLY TRENDS
						1Q23 Change
	1Q23	4Q22	3Q22	2Q22	1Q22	4Q22			1Q22
						$	%		$	%




Other income, Underlying:
Other income (GAAP)	$17	$36	$34	($12)	$24	($19)	(53)		($7)	(29	%)
Less: Notable items	—	—	—	(31)	—	—	—		—	—
Other income, Underlying (non-GAAP)	$17	$36	$34	$19	$24	($19)	(53)		($7)	(29	%)
Salaries and employee benefits, Underlying:
Salaries and employee benefits (GAAP)	$658	$633	$639	$683	$594	$25	4	%	$64	11	%
Less: Notable items	16	15	17	72	6	1	7		10	167
Salaries and employee benefits, Underlying (non-GAAP)	$642	$618	$622	$611	$588	$24	4	%	$54	9	%
Equipment and software, Underlying:
Equipment and software (GAAP)	$169	$170	$159	$169	$150	($1)	(1	%)	$19	13	%
Less: Notable items	4	2	—	6	2	2	100		2	100
Equipment and software, Underlying (non-GAAP)	$165	$168	$159	$163	$148	($3)	(2	%)	$17	11	%
Outside services, Underlying:
Outside services (GAAP)	$176	$170	$172	$189	$169	$6	4	%	$7	4	%
Less: Notable items	27	17	20	41	35	10	59		(8)	(23)
Outside services, Underlying (non-GAAP)	$149	$153	$152	$148	$134	($4)	(3	%)	$15	11	%
Occupancy, Underlying:
Occupancy (GAAP)	$124	$110	$106	$111	$83	$14	13	%	$41	49	%
Less: Notable items	18	2	2	1	—	16	NM		18	100
Occupancy, Underlying (non-GAAP)	$106	$108	$104	$110	$83	($2)	(2	%)	$23	28	%
Other operating expense, Underlying:
Other operating expense (GAAP)	$169	$157	$165	$153	$110	$12	8	%	$59	54	%
Less: Notable items	1	7	7	5	5	(6)	(86)		(4)	(80)
Other operating expense, Underlying (non-GAAP)	$168	$150	$158	$148	$105	$18	12	%	$63	60	%

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS - SEGMENTS

(in millions, except ratio data)


		FIRST QUARTER 2023							FOURTH QUARTER 2022							THIRD QUARTER 2022

		Consumer Banking		Commercial Banking		Other	Consolidated		Consumer Banking		Commercial Banking		Other	Consolidated		Consumer Banking		Commercial Banking		Other	Consolidated
Net income (loss) available to common stockholders:
Net income (loss)	A	$281		$319		($89)	$511		$315		$358		($20)	$653		$319		$334		($17)	$636
Less: Preferred stock dividends		—		—		23	23		—		—		32	32		—		—		25	25
Net income (loss) available to common stockholders	B	$281		$319		($112)	$488		$315		$358		($52)	$621		$319		$334		($42)	$611
Return on average total tangible assets:
Average total assets (GAAP)		$87,558		$78,891		$56,262	$222,711		$88,440		$79,591		$56,939	$224,970		$89,560		$80,067		$55,846	$225,473
Less: Average goodwill (GAAP)		538		763		6,876	8,177		491		804		6,876	8,171		454		801		6,876	8,131
Average other intangibles (GAAP)		115		43		34	192		121		46		32	199		106		38		84	228
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP)		23		12		387	422		7		4		413	424		6		3		415	424
Average tangible assets	C	$86,928		$78,097		$49,739	$214,764		$87,835		$78,745		$50,444	$217,024		$89,006		$79,231		$49,301	$217,538
Return on average total tangible assets	A/C	1.31	%	1.66	%	NM	0.97	%	1.42	%	1.80	%	NM	1.19	%	1.43	%	1.68	%	NM	1.16	%
Efficiency ratio:
Noninterest expense (GAAP)	D	$889		$331		$76	$1,296		$863		$318		$59	$1,240		$863		$325		$53	$1,241
Net interest income (GAAP)		1,096		597		(50)	1,643		1,106		594		(5)	1,695		1,085		559		21	1,665
Noninterest income (GAAP)		256		201		28	485		256		198		51	505		270		213		29	512
Total revenue (GAAP)	E	$1,352		$798		($22)	$2,128		$1,362		$792		$46	$2,200		$1,355		$772		$50	$2,177
Efficiency ratio	D/E	65.81	%	41.47	%	NM	60.90	%	63.38	%	40.18	%	NM	56.36	%	63.76	%	42.04	%	NM	57.02	%


		SECOND QUARTER 2022							FIRST QUARTER 2022

		Consumer Banking		Commercial Banking		Other	Consolidated		Consumer Banking		Commercial Banking		Other	Consolidated
Net income (loss) available to common stockholders:
Net income (loss)	A	$265		$341		($242)	$364		$209		$271		($60)	$420
Less: Preferred stock dividends		—		—		32	32		—		—		24	24
Net income (loss) available to common stockholders	B	$265		$341		($274)	$332		$209		$271		($84)	$396
Return on average total tangible assets:
Average total assets (GAAP)		$88,881		$78,638		$53,448	$220,967		$77,551		$61,118		$49,648	$188,317
Less: Average goodwill (GAAP)		445		731		6,839	8,015		160		120		6,876	7,156
Average other intangibles (GAAP)		74		16		123	213		51		18		11	80
Add: Average deferred tax liabilities related to goodwill and other intangible assets (GAAP)		6		1		409	416		5		1		377	383
Average tangible assets	C	$88,368		$77,892		$46,895	$213,155		$77,345		$60,981		$43,138	$181,464
Return on average total tangible assets	A/C	1.20	%	1.75	%	NM	0.69	%	1.10	%	1.81	%	NM	0.94	%
Efficiency ratio:
Noninterest expense (GAAP)	D	$881		$308		$116	$1,305		$784		$272		$50	$1,106
Net interest income (GAAP)		995		534		(24)	1,505		857		416		(126)	1,147
Noninterest income (GAAP)		280		221		(7)	494		257		213		28	498
Total revenue (GAAP)	E	$1,275		$755		($31)	$1,999		$1,114		$629		($98)	$1,645
Efficiency ratio	D/E	69.06	%	40.78	%	NM	65.27	%	70.38	%	43.32	%	NM	67.23	%